Why Cloud Apps Could Destroy Your Accounting Practice

While I think most would agree that the accountant-client relationship is fundamental to the success of a small business, the shift in the way we build and maintain this relationship has changed dramatically.

Perhaps for most, the most fundamental shift we are experiencing today is the continual shift to cloud technology. It is hard to pick up an accounting or bookkeeping publication without being inundated with predictions about the demise of practices that don’t make the shift quick enough from compliance-based models to a concerted focus on advisory services.

But for those of you who were practicing in the early '80s, the recent cloud movement is eerily reminiscent of a similar shift that nearly destroyed the accounting profession.

Unknowingly, Apple and Microsoft nearly destroyed our profession when they introduced the personal computer, essentially isolating us from the data we used to perform client services. The new PCs and desktop software that accompanied them allowed, and even encouraged entrepreneurs, for the first time ever to do all of their own bookkeeping and financial statements.

Sound familiar?

More than any other advisor to small business clients, we have the strongest connection and ability to influence, but we must choose wisely.

These PCs and their new-fangled desktop software solutions seemed like a godsend to many, but it fundamentally changed the business model for accountants and forever impacted our role as trusted advisors.

We became isolated from the general ledger and related information. It moved us further away from our role as a partner in the business, and closer toward becoming a servant that only provided a commoditized, i.e., price sensitive service.

We were quickly relegated to perform low margin, mind-numbing and soulless work. It left us feeling devalued. It also became much harder to substantiate the value of our work to our clients. We were pushed out of the boardroom, left to clean up the mess each year at tax time, and relegated to crank out the mountain of paperwork needed to comply with corporate and tax requirements.

The legacy of that shift still haunts our profession today.

The new call to action preached from the mountaintop is that we must step up and embrace our rightful position as the “most trusted advisor." But few can explain succinctly just how to make that shift for themselves and their firms.

What does “most trusted advisor” mean and how exactly do you become one?

Is it the person who controls the cloud accounting file? Is it the one who produces the financial statements and tax returns based on yesterday's results? Is it the one who has to learn to brand and market himself as the expert? Is it the person who produces the "beautiful" dashboard/graph with the fancy add-on software once a quarter?

Let's be frank – there's no shortage of "experts" lined up to take your money right now to use their software (or attend their course) to become the “most trusted advisor." Unlike before, this new shift to the cloud also means there are apps for virtually everything, including multiple options for dashboards, KPIs and insights.

And the race is on for us to try everything and become an expert at marketing our firms, bringing in more leads, closing them, and then building the team to deliver this incremental advisory work.

Sounds exhausting and daunting, doesn't it?

But what if our future role as the "most trusted advisor" isn't about cloud technology, apps, dashboards or KPIs at all? What if it was something so primitive, so simple and so personal that only we could deliver it?

In time, I think it will become clear that the future of our profession lies in our ability to influence and persuade our clients to take the actions they need to take to move their business forward. And to do that, we must get better at captivating attention, creating impact, getting leverage, being remembered and inspiring action.

So you might be asking yourself, "How exactly do I do that"?

To become the "most trusted advisor," we must become experts at communication and influence – not pumping out forecasts and dashboards, dominating social media or mastering the art of sales.

In the early '80s, the PC isolated us from the data, and we settled for the work we thought we needed to do in order to remain relevant and significant.

What does “most trusted advisor” mean and how exactly do you become one?

This time, we have a choice and the benefit of hindsight.

What does “most trusted advisor” mean and how exactly do you become one?

We can respond differently and champion our own destiny, instead of following blindly and being caught up in the fear and hype of "being left behind" if we don't embrace all of the new tech options. This time, we can sit back, discern what’s best for our future and strategically plan how we want this to unfold.

More than any other advisor to small business clients, we have the strongest connection and ability to influence, but we must choose wisely.

If we get caught up in the hype (and potential commissions) of selling the newest and latest apps to our clients on a weekly basis, we risk even greater harm to our profession. In fact, we may get relegated to the unsavory pile of "slick salesmen."

Technology brings with it incredible access to timely information and valuable insights about the future. But it's what we choose to do with those insights that will determine whether we step up and claim the mantle as "most trusted advisor," which is rightfully ours.

We must decide whether we’re in the business of promoting apps with beautiful graphs to make money, or if we're truly interested in connecting with our clients and helping them quantify the cost of continuing to ignore problems.

Dashboards don't fix problems. To become the "most trusted advisor," we need to find better ways to provide our clients with step-by-step guidance and encouragement to put strategies (and systems) in place to fix problems and prevent them from recurring again next month.

As a credentialed executive, entrepreneur and innovator in the science of the mind and business acceleration, Rhondalynn Korolak founded Imagineering Unlimited in 2007 to help business owners put strategies in place to grow their bottom line and ensure their customers would never think of going elsewhere. She is the leading expert on harnessing the power of your mind and using it to improve your financial results in business.

Tags

Comments (1)

I see where you're going, but....

Hi Rhondalynn,

I get where you're trying to go with your article, but I don't think you quite closed the loop.

I wholeheartedly agree that pretty graphs in the cloud does not a "trusted advisor" make. I also agree that successful advisors aren't "in the business of promoting apps." Moving to cloud apps for technology's sake alone (or referral fees - which, hello, nobody gets rich on) does not get you there. You definitely need to be fixing an actual problem.

However, in my opinion, one of the biggest problems with desktop solutions is that they are a headache to use when trying to share information with your client, and many cloud apps (i.e., Xero, Bill.com, and others) fix that problem right out of the gate.

I think that if you are knowledgeable and selective about the tools that are used, those tools almost fade into the background and allow the advisor to shine because you're no longer struggling with the logistics of backing up and restoring and overwriting and corrupting and fixing (and blah, blah, blah). Instead, you and your client are both just logging in and talking about the information that's there. And *that's* what your clients want... attention and insight on their numbers.

If people want to become trusted advisors, they need to 1) learn what their clients want and need, 2) learn how to fill those wants and needs, and 3) actually fill their wants and needs. When you can do that, you become a trusted advisor. Period.

I think there are a lot of available cloud apps that can help with #3... actually filling the needs of their clients, and that's why they're so popular. Cloud apps are not hype... they have the potential to be a major help in achieving the goals that everyone is seeking.

I would be careful not the throw the baby out with the bathwater here. Just my two cents.